Income-based repayment (IBR)

Make payments based on what you can afford

If you cannot afford to make payments because your income is too low, Income-Based Repayment (IBR) may be a good option for you.

IBR is a federal program that allows you to reduce your monthly student loan payments based on:

Income;

Family size;

The poverty line for your area.

For most borrowers under IBR, payments will be less than 10% of your income. Also, if any student loan debt remains after you have made payments for 25 years, the loans can be forgiven, meaning that you would not have to pay back the remaining balance. Keep in mind, though, that the Internal Revenue Service (IRS) will treat this forgiven loan amount as taxable income.